Nath invites global CEO's to be a part of India growth story

Published: Monday, October 29, 2007, 22:02 [IST]

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New Delhi, Oct 29 (UNI) Union Commerce and Industry Minister Kamal Nath today said that the government is in the process of bringing out a regulatory frame work which will govern private participation in the infrastructure sector Mr Nath said India requires 456 billion dollars in the infrastructure sector during the eleventh plan period (2007-2012) and to cater to this massive resource requirements, the country is exploring public-private partnerships in this area.

Talking on the India growth story, Mr Nath invited world's industry and business leaders to become a part of growth process.

Addressing the Fortune Global Forum-2007 at the Red Fort, Mr Nath said India has also liberalised its foreign direct investment (FDI) policy, allowing up to 100 per cent on the automatic route in sectors like power generation and distribution, roads and highways, and ports.

Immense opportunities for investment also exist in sectors like food processing and packaging, automobiles and auto components, information technology and IT enabled services and pharmaceuticals, he added.

Besides these opportunities for global industry and businesses, Mr Nath said India also offers 'unmatched demography' being home to 20 per cent of the world's population under 24 years.

India's working age population accounts for 60 per cent of its total population. India's middle class is likely to double to 20 per cent of the population by end of the current decade and thus will become a 250-million strong market.

India's civil aviation sector, he said, is one of the fastest growing in the world and domestic air passenger traffic increased by 39 per cent in 2006.

The Minister said India by tapping the potential of its advantages in labour-intensive sectors of manufacturing could transform itself into a global manufacturing hub and help employ tens of millions of young people.

In an effort to seize this opportunity, the country has accelerated the pace of setting up special economic zones (SEZ).

Stating that business confidence and expectations in India are very positive, Mr Kamal Nath said its annual rate of growth in the last four financial years has been above eight per cent, adding that it was nine per cent and 9.4 per cent in the last two financial years respectively.

The high growth rate achieved by India, he said, is not an accident but result of government's liberalised economic policy. The new policy opened more sectors for foreign investment, reduced government control, encouraged the private sector to expand both internationally and domestically and encouraged foreign trade through lower restrictions, lower taxes and other direct and indirect incentives.

He said savings and investment ratios, as a proporiton of GDP, were 32.4 per cent and 33.8 per cent respectively during 2005-06.

Last year, FDI flow into India was 15.7 billion dollars and target for the current year is 30 billion dollars.

He expressed conviction that the captains of worldwide businesses and industy will go back with renewed faith in partnering and collaborating with India in their investment decisions.